South Africa’s JSE hits new record high

Surging metal prices and a strengthening rand helped propel South Africa’s benchmark stock index to a record high on Monday, with investors expecting the rally to run further.

The FTSE/JSE Africa All Share Index jumped more than 1%, bringing its gain this year to 6.8%. Precious metals and mining stocks led the advance as gold passed $5,000 an ounce for the first time. Platinum and silver also reached record highs.

The rand, meanwhile, strengthened below 16 per dollar for the first time since 2022, boosting prospects of lower inflation and interest rates.

South African fund managers are getting more bullish on the country’s equities, even after a powerful rally that lifted the market more than 50% in dollar terms last year, according to a survey conducted earlier this month by Bank of America.

The benchmark is still relatively cheap, with an estimated forward price-earnings ratio of 15.6, compared with 16.9 for MSCI’s emerging-market stock gauge.

“We do need to temper expectations after such a strong run,” said Rehana Khan, co-head of South African equity and multi-asset at Ninety One, which oversees about R3.5 trillion.

“But we still expect inflation-beating returns from South African equities through the course of 2026.”

Ninety One expects double-digit earnings growth across parts of the market, supported by easing inflation, lower interest rates and a modest economic recovery.

Risks to the outlook are a resurgence in global inflation that delays or reverses monetary easing, while a stronger US dollar would weigh on emerging markets.

Elevated geopolitical tensions and structural disruption from artificial intelligence also add to uncertainty.

“But if you stay focused on fundamentals and disciplined in your process, those periods of volatility can create opportunity,” Khan said.